Associated PressJockies approach the starting gate at Beulah Park which is located just outside Columbus. An agreement signed Friday by the track owner, Penn National Gaming Inc., and Gov. John Kasich would relocate the track to the Youngstown area.

COLUMBUS, Ohio -- Penn National Gaming Inc. has reached an agreement with Ohio Gov. John Kasich to close its horse racing tracks in suburban Columbus and Toledo and move them to the Dayton and Youngstown areas, the last major untapped gambling markets in the state.

The national gambling company will pay the state an additional $150 million for the right to relocate the tracks, will invest at least $300 million in the new complexes, and has promised to give employees who will lose their jobs preference for positions at the new gambling and entertainment complexes.

A Penn spokesman said yesterday that the agreement was contingent on actions by the state racing commission, the lottery commission and Ohio lawmakers. Penn has no immediate plans to break ground on the new operations, which will be located on 125-acres in Dayton and a 186-acres in Austintown Township, just outside Youngstown.

"It's conditional, is what it is," said Penn spokesman Bob Tenenbaum, who added, "We're very confident that this will move forward."

"It's premature to try to set a timeline," Tenenbaum added. "What we know is that we would open the new facilities approximately 18 months from the time we broke ground. The other two tracks will remain open until the new facilities are ready to go."

Rob Nichols, a spokesman for Kasich, said the relocations would better balance the development of gambling in the state.

State and company officials pointed out that Penn's two horse tracks, Raceway Park in Toledo and Beulah Park in suburban Columbus, are just miles from Las Vegas-style casinos the company is building in the same cities and another horse track, Scioto Downs, in southern Franklin County.

Additionally, they said that $150 million Penn will pay for the right to move its tracks is above its $100 million licensing fees for slots at the two facilities and an ongoing 33.5 percent tax on slot revenue.

"We think it's a good deal for taxpayers," Nichols said. "It creates a better market place for the industry. We're pleased with Penn as negotiators . . . and we're glad to come to an agreement that's mutually beneficial."

What's not known is whether a lawsuit filed in October by the anti-gambling Ohio Roundtable will scuttle the governor's plans to expand gambling beyond the four casinos approved by voters in 2009. The group contends that Kasich's deal to bring slot machines to Ohio's horse tracks is illegal because it circumvents the Ohio constitution.

A Franklin County Common Pleas Court judge is expected to hear arguments in the next few days on a motion filed by Ohio Attorney General Mike DeWine to dismiss the lawsuit.

Meanwhile, despite the uncertainty, the owner of Scioto Downs, MTR Gaming Group Inc., is moving quickly to be ready to open a full-fledged racino at its Columbus harness racing track between April and June, the company disclosed in a U.S. Securities and Exchange Commission filing Thursday.

In December, after receiving state approval, MTR began construction to upgrade the track and add 2,500 slot machines, a 300-seat buffet, a 100-seat restaurant, an 82-seat bar and lounge with high-tech sound and lights, company officials reported in the document. The company is now hiring for the new Scioto Downs Casino & Racetrack.

Officials with Rock Ohio Caesars, which is set to open a Horseshoe Casino in May in Cleveland's Higbee Building and controls the Thistledown thorough-bred track in North Randall, said they intend to add slot machines to the track and are keeping their options open regarding a possible relocation in light Ohio's changing gambling landscape.

As for Penn, officials said Friday that the Ohio Racing Commission would have to formally adopt the $75 million relocation fee agreed to by the governor and Penn. The state Lottery Commission, which will license and regulate slot machines at the horse track, needs to approve the licenses. And Tenenbaum added that the Ohio General Assembly needs to revise and pass a bill now being considered that has provisions relating to installing slots at race tracks and the minimum number of racing days.

Penn owns the property in Dayton, which is located at the intersection of Wagner Ford and Needmore roads. It has an option to buy the land in Austintown in the Centerpointe Business Park near I-80 and State Route 11.

Tenenbaum said the new complexes would carry the Hollywood brand name, the same as the casinos being developed by Penn in Toledo and Columbus. He anticipated the new tracks would have about 2,500 slot machines, the maximum allowed by the state.

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